A spreadsheet balance is not a legal conclusion
If you owe a counterparty who also owes you money, subtracting balances does not establish discharge. Check that the parties match, what each obligation involves, when it is due, and whether restrictions or defenses apply. Unilaterally withholding a due payment based on an assumption can create another dispute.
For example, if Company A has a claim against Company B but A’s director personally owes B money, these are not mutual debts between the same parties merely because the director handles communications. Separate contractual identities and signing capacities before calculating.
Basic conditions and the declaration
Section 341 of Thailand’s Civil and Commercial Code addresses reciprocal obligations of the same kind that are both due, allowing discharge to the matching amount. Exceptions concerning the nature of an obligation and the parties’ expressed intention remain relevant. Not every pair of monetary claims can therefore be set off.
Section 342 requires a declaration to the other party that is not conditional or subject to a commencement or end time. Its effect relates back to when set-off first became possible. Establish the relevant facts rather than substituting the date a bookkeeping spreadsheet was edited.
An example with explicit assumptions
Assume A owes B THB 100,000 and B owes A THB 60,000. Both monetary debts are due, no defenses or prohibitions apply, and a valid declaration is made. THB 60,000 is offset, leaving A owing THB 40,000. This illustration excludes interest, costs and other debts and does not decide an actual claim.
If the THB 60,000 is merely one party’s damages estimate and the other has a defense, have the claim reviewed first. Section 344 restricts set-off of claims subject to a defense. Do not treat disputed amounts as established debts just to balance a worksheet.
Cases requiring particular scrutiny
Sections 345–347 also impose restrictions involving obligations arising from unlawful acts, claims immune from judicial seizure and debts acquired after a court order bars a third-party debtor from payment. Attachment, assignment or multiple debts with interest require review of the specific rules and allocation, not reliance on the simple example.
Prepare contracts, invoices, delivery and payment evidence, due dates, objections and any earlier set-off messages for B Law Firm. Give each debt its own row with parties and supporting evidence. Flag court papers or hearing dates promptly. This supports a response and next steps, not a guaranteed right to set off.
References
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